There is an old saying in China: Slow work makes fine work. Accordingly, rushing to work can only be bumpy. Although it is a bit exaggerated, it should be appropriate in general.

As mentioned above, the SOX Act is an emotional product: American society is generally angry at the corrupt behavior of company executives. For example, on July 25th, 2002, John Rigas, the former CEO of Adelphia Company, was publicly arrested. According to media reports, J. Rigas' lawyer had consulted with the Ministry of Justice and asked J. Rigas to report to the place designated by the Ministry of Justice. However, the Ministry of Justice refused this request, and at the age of 78, J. Rigas became the first corporate executive in the United States to walk in handcuffs in the past 20 years. At a subsequent press conference, the US Deputy Minister of Justice and the head of the corporate fraud punishment working group appointed by President Bush said that corporate executives (illegally occupying company property) are no different from ordinary street thieves. (Arresting them publicly) is an appropriate way to punish corporate crime. Because of this, one of the key points of SOX Act is to strengthen the criminal responsibility of enterprise executives and white-collar workers for crimes. For example, article 906 of SOX Act stipulates that a company executive who takes an oath knowing that there are false contents in the financial report can be fined 5 million dollars or/and imprisoned for up to 20 years.

Another focus of SOX Act is to strengthen the supervision of accounting profession. This background has been mentioned before, so I won't repeat it here.

The internal logic of SOX Act itself is chaotic, which is reflected in many aspects. First, it is the product of several bills, such as Chapter 8 and Chapter 9 from the original S2673, and Chapter 1 1 from the original HR5 1 18. At the same time, it also absorbed some contents of S2004. Because there are several SOX bills in the end, this is an inevitable phenomenon. In particular, the criminal responsibilities of enterprise executives and white-collar workers are scattered in chapters 8 and 9 and 1 1 respectively. In other words, the same sentence has three parts discussing the same or similar topics, and repetition is inevitable. Some places are inconsistent with themselves, and some regulations are inconsistent with the existing laws. In addition, regarding the responsibility of corporate executives for the authenticity of financial reports, Article 30. Because the SOX Act has been implemented for a short time and lacks necessary observation values and observation intervals, any inspection can only be preliminary.

As mentioned above, the purpose of SOX Act is to strengthen corporate responsibility, so as to protect the interests of investors in listed companies from the infringement of company executives and related institutions. Its internal logic thinking is: improving the timeliness and accuracy of financial reports and information disclosure of public companies can effectively protect the interests of investors of public companies; Strengthening the financial reporting responsibility of corporate executives and providing the independence of external audit will help to improve the quality of corporate financial reporting and information disclosure. Many contents and regulations given by SOX Act are related to this. Whether SOX Act improves the information disclosure quality of listed companies and better protects the interests of investors will be tested in the future market. In related literature, Cohen et al. (2003) examined the degree of earnings management of listed companies before and after the promulgation of SOX Act. First, they collected the data of earnings management of American companies from 1987 to the second quarter of 20001year (the Enron incident began to detonate in that year1year), and the data showed that earnings management of American companies continued to rise. Then, they also collected relevant data after SOX Act was passed (from the third quarter of 2002 to the second quarter of 2003), and found that earnings management was significantly reduced and the quality of accounting information was significantly improved.

The second chapter of Sarbanes-Oxley Act focuses on audit independence and puts forward some measures, one of which is to prohibit accounting firms from providing audit services and consulting services for the same client at the same time. Lai (2003) found that after the implementation of SOX Act, auditors were more willing to provide non-standard unqualified audit reports, and the degree of earnings management in the company's reported profits decreased. His findings support the inference that SOX Act improves audit independence.

Li et al. (2003) tested it from different angles. They analyzed the SOX Act and its related events, and selected 20 related event days. They think that one of the core contents of SOX Act is to strengthen audit committee and limit earnings management (improve information quality). If the market can fully expect the influence of SOX Act, then the market reaction of listed companies with high earnings management and poor independence of audit committee should be significantly different from that of listed companies with less earnings management and strong independence of audit committee. Their empirical results cannot strongly support their inference. Finally, the author thinks that the passage of SOX Act is only an instinctive response to the increasing number and scale of accounting fraud in the market, and its content is more the slogan and incitement of politicians than the real reform.